Pollution forces Ikea HQ to head out of Delhi-NCR

Patrik Antoni, deputy country manager for Ikea India, said its purchasing department, which has around 150 people, will continue to be based in Gurgaon.Rasul Bailay | ET Bureau | December 28, 2016, 09:05 IST

Ikea had conducted an internal study that suggested moving to the country’s IT capital, citing pollution and the extreme weather in Delhi NCR among other issues.GURGAON: About a decade ago, the Ikea group shifted its sourcing office from Delhi to Gurgaon to avoid the nightmarish traffic and worsening pollution levels in the National Capital.

Now, as Gurgaon grapples with the same issues that Ikea thought it escaped then — traffic and pollution — the Swedish retail giant is preparing to move its corporate headquarters to a less toxic environment by mid-2018. “The corporate office is moving to Bengaluru for sure. New hires have to agree to be in Bengaluru," said a person with knowledge of this.

A significant number among about 100 retail division employees have already decided to move to the Karnataka capital and the rest have until mid-2017 to shift or take jobs in other departments in the Delhi National Capital Region. Ikea had conducted an internal study that suggested moving to the country’s IT capital, citing pollution and the extreme weather in Delhi NCR among other issues.

Patrik Antoni, deputy country manager for Ikea India, said its purchasing department, which has around 150 people, will continue to be based in Gurgaon.

“Some functions are moving to Bengaluru, Mumbai and Hyderabad but the Ikea group will also have coworkers and offices in Gurgaon or Delhi,” he said. The division that handles Ikea’s India retail rollout has 100 employees in Gurgaon, 50 in Bengaluru, 50 in Hyderabad and 30 in Mumbai, Antoni said.

Ikea is readying its “temporary” corporate office in Manyata Embassy Business Park in Bengaluru, which will house about 300 staff. It eventually plans to build a corporate office on top of its flagship store there, a spot it has not homed in on yet. So far, the world’s largest home products retailer has purchased land in Navi Mumbai and Hyderabad, where the country’s first Ikea store is expected to open some time next year.

In the early 2000s, a host of multinationals, including GE, Coca-Cola, Pepsi, Gillette BSE -0.10 % and Reebok, shifted corporate offices to Gurgaon as it provided an alternative to Delhi. That and the mushrooming of tech companies in Gurgaon turned the once sleepy suburb into a bustling city and an outsourcing hub. Antoni said Ikea has ``a contact centre in Hyderabad, retail support in Bengaluru and Gurgaon, customs department in Mumbai and a purchasing office in Gurgaon.